Consider the Barnes and Nobles example above, and suppose demand is normally distributed with the standard deviation of weekly demand being 20 books. The lead-time is four week. What safety stock is necessary if the manager uses a continuous review inventory system, and a 98% service level (Use z = 2, for 98% service level)?

(02.01 MC)According to King Alfred, what were the “three estates” of European society?

In the Dave’s Sub Shop example above, what is the cycle time?

Overbooking will not increase revenue when …

A small retailer is considering various monthly plans for purchasing electricity. They can pre-purchase kWhs at the cost of 4.5 cents per kWh.  If they don’t use all of the kWhs they purchase, then there is no refund for the unused electricity. If they need more kWhs than they purchase, the extra kWhs are purchased at the rate of 6 cents per kWh.  Their forecast for kWh usage per month is normally distributed with a mean of 6000 and a standard deviation of 2500. What is the cost of over-estimation?  

Kick Flip Inc. makes skateboard decks for specialty skateboard stores. The production process of the skateboard decks is done in batches and consists of the 3 steps shown in the figure below. The size of each batch is 20 decks and demand is one batch per hour. In the first stage the raw material is sanded. This step takes 3 minutes per deck. After this step, the decks are painted using a Lithography machine. This step takes 2 minutes of production time per deck. The decks are then loaded onto a pallet and dried quickly using an ultraviolet lamp. The lamp can dry up to 20 decks at one time. Drying takes 30 minutes. Each state (i.e., sanding, painting, and drying) has one operator. What is the capacity of the “Painting” stage in batches?

I have read the syllabus for this course and have contacted my instructor with any questions I have so that I understand the information therein

Bullwhip effect leads to higher variability in orders than the customer demand.

Sunny Airlines is contemplating overbooking the economy class in its popular daily flight from Minneapolis to Honolulu, with the objective of extracting the maximum out of otherwise happy vacationers. The number of no-shows in the economy class of this flight over the past few weeks is normally distributed with the mean of 2 and standard deviation 3. All customers pay for the ticket ($500) in advance and no shows are not given a refund. Each customer who is denied boarding is refunded the price of the ticket and is compensated $350 for the trouble. There are 250 seats in the economy class on this route.   What are the costs of over-estimation?

Consider the Ray’s Satellite Emporium example above. The manager wants a 99.5% service level. Calculate the reorder point. (The Normal distribution table is attached below.)